How much of your business budget should be going towards energy costs?

Now more than ever, a clear business energy budget is essential

Energy prices have been in the news a lot recently, and not for good reasons. The new energy price cap level was introduced by the energy regulator Ofgem on 1^st April and will see the average UK household pay £1,971 a year for their energy bills, compared to the previous cap of £1,277[1]. This is set to have an impact on pretty much everyone’s energy budget.

Businesses aren’t faring any better either, with commercial energy prices rising just as sharply. For brands trying to budget their daily services and encourage long term growth, energy prices represent a huge hurdle to overcome.

Understanding more about your energy prices, and how this impacts your business budget, can help you make smart decisions when organising your funds. And Consultiv Utilities is here to help.

How much energy does the average business use?

It goes without saying that the size of your business will impact how much energy you are using. There are over 200,000 small businesses in the UK (with between 10 and 49 employees), according to government figures. For these businesses, the average energy bill is around £3,507 per year. For medium businesses (with between 50 and 250 employees) the average annual bill is £6,462 per year, while large businesses (250+ employees) have an average energy bill of £11,978.[2]

However, other factors can also impact your energy bills. Remote/office working, the nature of the software and devices used by your business, and employee habits will all play a part in determining how much you spend.

Overestimating is better than underestimating when it comes to your energy budget

Energy bills shouldn’t be a guessing game. Get familiar with your current rates and contract terms, so you know how much to set aside each month. However, if you do find yourself needing to estimate your energy costs – in the case of planning out a future budget for example – remember that it’s always better to overestimate than underestimate your bills.

Setting aside too much money for your energy allows you to reassess and readjust your budget without unnecessary stress, while underestimating it could leave you facing bills you can’t actually afford to pay.

How to reduce your business energy bills

Thankfully, businesses aren’t powerless when it comes to keeping your energy usage down. Encouraging competitive practices across your organisation can make a significant difference over time, such as switching off devices at the plug, and switching lights off when leaving the room. Similarly, making the swap to sensor lights, smart meters and other energy-saving methods can help you keep your energy costs downs.

Switching business energy can also help you save on your bills in the long run. More than half (51%) of UK SMEs consider switching providers to be too challenging, according to the National Business Energy Survey 2020, yet finding an energy contract that better suits your needs can yield significant long term benefits when it comes to your budget.[3]

Consultiv Utilities can help you make sense of your bills and pay less for your energy

When it comes to reducing your energy spending, Consultiv Utilities are on hand to ensure that your organisation takes the necessary steps.

We can help you make sense of your energy contracts and seek out valuable deals for your needs. We can also support you as you prioritise your sustainability goals, promoting a greener future for your organisation while also saving money that can then be placed elsewhere.  

Thanks to our years of expertise, we are confident that we can cut your business energy costs. We will work with you every step of the way to ensure that your utilities are both manageable and transparent.

Are you ready to improve your energy outlook? Get in touch with the team at Consultiv Utilities today.

[1] https://www.ofgem.gov.uk/publications/price-cap-increase-ps693-april

[2] https://www.businessenergy.com/blog/what-does-the-average-uk-business-spend-on-energy/

[3] https://www.energybillkill.com/energy-switch-survey-2020/